Federal climate policy and your leverage on it

Paul HigginsSenior Policy Fellow, The American Meteorological Society

Contributor, www.ClimatePolicy.org

phiggins@ametsoc.org

ClimatePolicy.orgAn American Meteorological Society Project

Recommended Reading

• Dessler, A.E., & Parson, E.A. The Science and Politics of Global Climate Change: A Guide to the Debate. Cambridge University Press, 2006.

• Stavins, R.N. A U.S. cap-and trade system to address global climate change. The Hamilton Project, 2007. (http://www.brookings.edu/papers/2007/10climate_stavins.aspx)

• Metcalf, G.E. A proposal for a U.S. carbon tax swap: an equitable tax reform to address global climate change. The Hamilton Project, 2007. (http://ase.tufts.edu/econ/events/specialEventsDocs/metcalfCarbonTax.pdf)

• Aldy, J.E., Barrett, S., & Stavins, R.N. Thirteen Plus One: A Comparison of Global Climate Policy Architectures. Climate Policy 3(4): 373-397. (http://www.rff.org/Documents/RFF-DP-03-26.pdf)

Opportunities for civic engagement• Outreach to the public

– Op-eds, letters to the editor, contributions to blogs/web commentary– Speak to local groups (Lions clubs, Rotarians, etc.)

• Outreach to Congress

• AAAS Mass Media Fellowship– http://www.aaas.org/programs/education/MassMedia/index.shtml

• AMS Summer Policy Colloquium & Leadership Development Program– http://www.ametsoc.org/spc

• AAAS Science & Technology Policy Fellowships (sponsored by AAAS, AMS, AGU, GSA, AGI, and others)

– http://fellowships.aaas.org– http://www.ametsoc.org/csf

ClimatePolicy.orgAn American Meteorological Society Project

Society’s options Wait and see

(+) no wasted effort

(-) maximizes suffering Mitigate

(+) reduces risk

(-) may waste resources

(-) some impacts unavoidable

Adapt

(+) better handling of risks

(-) some impacts too severe

Geo-engineer

(+) potential desperation strategy

(-) may trigger big side-effects

(-) some impacts unavoidable

Cap & Trade: design issues

• Targets and timetable

• Allocation of allowances & use of revenue– Auction permits or give them away

• Scope– Economy-wide or sector-limited (e.g., electricity)

• Point of regulation– Upstream (coal mine, refiners)– Downstream (tail pipes, homes, businesses)

• Cost containment– Price safety valve– Borrowing & banking

• International incentives

Source: John Larsen, World Resources Institute

Visit http://thomas.gov for submitted bills & analysis

The Safe Climate Act (H.R. 1590)

• Economy-wide cap on GHG emissions with a tradable permit system to allow emitters to reach that cap at the least cost

• Cap declines by 2% per yr until 2020 and then by 5% per yr– By 2020 US emissions would roughly equal 1990 levels– By 2050 US emissions would be 80% below 1990

• Permits may be auctioned or given away in any combination – Free allocation may not result in a windfall profit for polluters

• Revenue generated goes to a Climate Reinvestment Fund (CRF)– Promote economic growth, ease distributional consequences, help displaced

workers, fund RD&D, reward early action, or help the states

• NAS review– NAS may recommend further emissions reductions. The EPA

administrator must either implement these recommendations or explain to Congress the reasons for declining to act

Visit http://thomas.gov for submitted bills & analysis

Mitigation: four comparable frameworks for pricing carbon

• Cap & trade (C&T):– Set targets & timetable (80% reduction by 2050)

• Carbon fee (FEE):– Estimate fee schedule needed to reach targets & timetable

($45/ton in 2020 rising to $350 in 2050)

• Price safety valve (PSV):– Same targets & timetable but w/ a price safety valve equal to the

FEE schedule

• Climate safety valve (CSV):– Same fee schedule as FEE but it increases 20% if the targets

and timetable are missed

Mitigation: comparing frameworks

• Frameworks can be compared based on how effectively they influence…

– The quantity of emissions

– The price of emitting

• Relative effectiveness of the frameworks depends on how easy (cheap) or hard (expensive) it is to reduce emissions

If mitigation is cheap …

Year

Em

issi

ons

(mm

T C

O2e

)

FEE & CSV (2x cheaper)

FEE & CSV (10x cheaper)

C&T & PSV

Year

Em

issi

ons

(mm

T C

O2e

)If mitigation is expensive …

2X harder10X harder2X harder w/sv

10X harder w/sv

FEE & PSV (2x expensive)

FEE & PSV (10x expensive)

C&T

2X harder10X harder2X harder w/sv

10X harder w/sv

The Climate Safety Valve still hits the target

Year

Em

issi

ons

(mm

T C

O2e

)

FEE & PSV (2x expensive)

FEE & PSV (10x expensive)

C&T

CSV (2x expensive)

CSV (10x expensive)

Effort Needed to Reduce Emissions

Rel

ativ

e E

ffec

tiven

ess

of

Clim

ate

Pro

tect

ion

CAP

FEE

PSV

CSV

Relative Im

pact on theP

rice of Em

issions

Which framework is best? It depends on what we value

How about bills to enhance coping & avoiding the worst impacts?

• Adaptation– Create an climate adaptation council within the office

of the President (similar to the National Security council) that would assess current and future climate vulnerabilities and recommend strategies for improving our ability to cope

• Geo-engineering– Establish a geo-engineering research program along

with protective mechanisms to prevent and discourage the hasty deployment of geo-engineering solutions (e.g., criminal penalties and trade sanctions)

Three obstacles to action

• Persistent gap in understanding between research & policy communities

• Challenging distributional consequences: losers & winners of climate policy

• International cooperation

Obstacle #1: Persistent gap in understanding between research & policy communities

• Culture of science

• “Balance” in the media

• Scientific arrogance/communication skills

• Examples: the economics of climate change,& international responsibility for emissions

• Possible solution: more civic engagement by scientists

2005 CO2 Emissions

Hansen

CO2 Emissions 1750-20052005 CO2 Emissions

Hansen

Hansen

CO2 Emissions 1750-20052005 CO2 Emissions

Year 2003 per capita fossil fuel CO2 emissions (103 kg/year/person)

Obstacle #2: differences between losers & winners of climate policy

• Losers– Know they’ll be hurt– Care about few issues– Politically Organized– Powerful

• Winners– Don’t know they’ll gain– Care about more issues– Disorganized– Politically weak

Possible solution: Compensate losers & build a constituency with permits/revenues

Obstacle #3: International cooperation

• Problem: – Genuine need for a global effort– Political rhetoric against unilateral action (e.g., the

Byrd-Hagel resolution)

• Possible solutions: – A conditional unilateral response – Border tax adjustments to deal with those who

subsidize pollution– Encourage more accurate depiction of the problem

Strategies for engaging Congress

• Find the right staffers (usually the Legislative Assistant for energy and environment)

– www.governmentguide.com• firstname_lastname@senatorslastname.senate.gov• firstname.lastname@mail.house.gov

• Send a short message asking to talk/meet with them– Why you want to talk– Why they want to talk to you

• You’re a constituent• You work on an important aspect of the issue• You work at an important institution in their district

• Ways you may increase your effectiveness when meeting with staffers– Be clear about what you want the member to do– Be relevant (tie what you’re asking to larger issues that affect constituents) – Be aware that policy choices go beyond scientific understanding

• Consider inviting the member (or the LA) to tour your research facility– Check with the Legislative Affairs Office for constraints or help

Future career options• Science & engineering

– Further our understanding & help develop next generation technologies that can reduce emissions

• Business– Need for entrepreneurs who can provide the products & services that we want in

ways that promote climate security (energy, transportation, especially)

• Policy– Need for creative problem solvers/leaders who can develop approaches that will

protect climate, boost the economy, and diffuse political obstacles

• Writing– Inform decision makers and the public through journalism, books, etc.

• Advocacy– Speak for the climate system and all who depend on it

• Teaching– Educate & train the next generation of scientists & engineers, business owners,

policy makers, writers, and advocates

End

a b

Simple, cost effective solutions may be easier to find than we recognize …

Energy Expenditure (j)

Weight Loss(kg)

Walking 3.9 X108 12.2

Cycling 8.4 X108 26.0

$117

Policy-makers face trade-offs

• Climate protection vs price minimization– Cap & trade (fixed emission quantities, permit prices vary)

• Climate protection if mitigation is costly but at higher energy prices• Climate protection weaker if mitigation is cheap but at low energy

prices

– Carbon fee (fixed prices to emit, quantities vary)• More climate protection if mitigation is cheap but less if expensive

– Cap & trade w/ price safety valve (limits permit prices)• Protects energy and transportation prices but limits climate

protection

– Fee w/ climate safety valve (limits emissions quantities)• Ensures best climate protection, but also highest energy prices

Sample climate bills

• Waxman’s Safe Climate Act (H.R. 1590)– One of ~10 bills that will mitigate by putting a price on

greenhouse gas emissions

• The Climate Pollution Reduction Act (a mock bill)

• Thoughts on bill that could build adaptive capacity & responsibly explore geo-engineering

• Visit http://thomas.gov for submitted bills & analysis

The Climate Pollution Reduction Act

• Charges a fee to emit GHGs beginning in 2010 at $10 per ton (CO2e)

• PHASE 1 (2010 and 2020): fee increases by $1.00 each year– If less than 55% (40%) of global emissions are covered, the fee increases by $0.75 ($0.50)– If more than 70% (85%) of global emissions are covered, the fee increases by $1.25 ($1.50)

• PHASE 2 (2021 and 2050): fee increases by $2.00 each year– If less than 55% (40%) of global emissions are covered, the fee increases by $1.50 ($1.00)– If more than 70% (85%) of global emissions are covered, the fee increases by $2.50 ($3.00)

• Includes a trade penalty for non-cooperation– All exports from countries that fail to charge a pollution fee will face border tax adjustments

that equal the amount of pollution released during manufacture and shipment of that product

• Revenue recycling– 25% of all collected pollution fees will be used to offset disaffected parties such as displaced

workers, low-income members of society, and heavy energy consumers– 75% will be available to

• reduce taxes on income or investment• reduce the budget deficit• fund low-emission technology development and deployment

What impacts do we face?

• Some possible positive outcomes– Reduced cold stress – Improved agricultural productivity in high latitudes– Better shipping lanes

• But there are substantial risks of negative impacts– Human health (more heat stress, worse smog, changes to water

quality/supply, impacts from severe storms, changes in vector borne diseases)

– More intense storms– Rising sea levels– More floods and droughts– Ocean acidification (i.e., coral and the fish that depend on them) – Stress to other biological systems that we depend on

Will global warming be good?

• It’s possible:– We could get lucky

• Feedbacks mostly negative• Impacts mostly small or beneficial

– Human ingenuity could help us cope & find new opportunities

• But it’s unlikely, in my view– We might get unlucky

• Feedbacks mostly positive• Impacts mostly large and harmful

– Human society, and the systems that we depend on, are highly adapted to current climate conditions

– Unlimited downside risk but only minor upside potential